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Economy of Lesotho
History Lesotho, formerly known as Basutoland, was first settled in the 16th century by the Sotho people, but did not become a nation until somewhat recently, when Moshoeshoe I, who was a minor chief of the Bakwena, brought his and other tribes together so as to defend against the Matabele and Zulu in the 1820s. Despite its smaller size, the nation outlasted its rivals due to Moshoeshoe's leadership. Upon his death in 1870, arguments arose over succession, and by the 1890s the nation was under British rule. In 1910 it refused to become part of the Union of South Africa, instead choosing to remain under British rule."Lestho : History | The Commonwealth". The Commonwealth. Retrieved 20 February 2017. In 1965 a new constitution was formed which greatly diminished the King's powers,"About Lesotho". Archived from the original on 4 March 2016. Retrieved 20 February 2017. and the country obtained independence from Britain the next year. Poverty Lesotho has a low standard of living. As of 2015, it had a GDP per capita of approximately 1062.58 US dollars, which, when adjusted for purchasing-power-parity (PPP), is about 3015.83 international dollars. For comparison, that same year China's GDP per capita was approximately 8,280.09 US dollars, which is equivalent to 14,189.52 international dollars when adjusted for PPP."Report for Selected Countries and Subjects". International Monetary Fund. Retrieved 19 February 2017. As of the 2002/03 fiscal year, 37% of the population in Lesotho lived below the international $1 a day poverty line used by the World Bank. A larger percentage of the population lived below the poverty line in rural areas than in urban areas, at 41% and 25% respectively."LESOTHO Sharing Growth by Reducing Inequality and Vulnerability: A Poverty, Gender, and Social Assessment". World Bank. 2008. Retrieved February 20 2017. As of 2014, Lesotho had a Human Development Index (HDI) of 0.496, which indicates low human development, ranking it 162nd out of the 187 ranked countries by HDI."2014 Human Development Report Summary". United Nations Development Programme. 2014. Retreived 20 February 2017. Products According to the country's website, its economy "is based on subsistence farming and animal husbandry, as well as small-scale industries that include clothing, footwear, textiles, food processing and construction." Diamonds are a significant factor of Lesotho's economy; their production contributed almost 7% of the country's GDP in the 2010/11 fiscal year."Lesotho - Country Brief". Archived from the original on 31 March 2014. Retrieved 19 February 2017. The export of diamonds that year accounted for, on average, about 23.95% of the money made from exports each quarter. Water also plays a large role in Lesotho's economy. In the 2010/11 fiscal year, an average of approximately 42.7% of the government's non-tax revenue each quarter came from royalties from the Lesotho Highlands Water Project (LHWP), a project that exports water to South Africa. The entire non-tax revenue that year contributed, on average, about 16.8% of the total revenue each quarter. As such, royalties from the LHWP contributed to approximately 7.2% of the government's total revenue that year."Central Bank of Lesotho - QUARTERLY REVIEW - June 2011". Archived from the original on 11 October 2012. Retrieved 19 February 2017. Goals In order to further grow the economy and increase employment, the government of Lesotho intends to encourage expansion of the private sector and address regulations that may impact growth in a negative way. The government also very heavily encourages foreign investment in the country."Lesotho - Economy". The Lesotho Government Portal. Retrieved 20 February 2017. The country has also been working quite hard to diversify its sources of income, as a large portion of its money comes from remittances and subsistence farming. References Category:Economy